Why am I being asked to Restart System even though I have Canonical Livepatch?

I’m confused about when I need to do system restarts even though I have Canonical Livepatch on Ubunut 20.04LTS Server

$ sudo canonical-livepatch status --verbose
last check: 22 minutes ago
kernel: 5.4.0-29.33-generic
server check-in: succeeded
patch state: ✓ no livepatches needed for this kernel yet
client version: 9.5.5
architecture: x86_64
cpu model: Intel(R) Xeon(R) CPU E3-1230 V2 @ 3.30GHz
boot time: 3 weeks ago

Logging in gave me

Welcome to Ubuntu 20.04 LTS (GNU/Linux 5.4.0-29-generic x86_64)
62 updates can be installed immediately.
38 of these updates are security updates

So I did the usual

sudo apt update
sudo apt upgrade -y

but now I get
*** System restart required ***

and

$ cat /var/run/reboot-required.pkgs
linux-image-5.4.0-33-generic
linux-base

So do I need to restart and if so why? Isn’t Livepatch meant to take care of critical Kernel patches. Or am I misunderstanding what linux-image and linux-base are?

My understanding is that Livepatch exists so we don’t need to restart. How do I avoid this situation while still doing the security updates.

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Author: Gazzer